Job Market Expands for Yet Another Month in January

The U.S. job market added over 300,000 jobs while wages grew 3.2% for the last twelve months. The job market has been a shining spot in an economy facing rising rates, tariffs, and slowing global growth. New home sales grew dramatically month-to-month in November but are still slumped 7.7% from a year before. Lastly, the Institute for Supply Management showed that manufacturing growth is expanding at a faster rate in the first month of the new year, thanks to increased production and new orders.

• Sales of newly built homes rose dramatically in November, gaining 16.9% from a month prior. New home sales totaled 657,000 beating economists’ expectations for 571,000. While the initial figure is staggering, it is down 7.7% from November 2017 and subject to a wide margin of error. Over the prior twelve months, higher mortgage rates and a climb in prices has put downward pressure on new home sales.

• The Institute for Supply Management released the results of their January purchasing managers’ survey, showing a 2.3-point climb in the index to 56.6 during the month. The production and new orders component indices grew by more than six points during the month, while the prices index fell 5.3 points, dropping from 54.9 to 49.6. Inputs and prices have continued to be fundamental constraints on manufacturing sector growth in the U.S.

• Total nonfarm payrolls increased by 304,000 through the first month of 2019, while the unemployment rate edged up 4.0%. The climb in payrolls shows that the private sector continued to hire despite the 35-day government shutdown. January also marks the 100th straight month of jobs growth in the U.S. economy. Further, wages grew at least 3.0% for the sixth straight month. According to Beth Ann Bovino, the chief economist at S&P Global Ratings, the U.S. is a largely a self-sustaining, domestic-driven economy and the jobs figures continue to show that.